A 25,000 tonne illegal waste dump next to a primary school in Wigan presents “a grave environmental hazard” and should be cleared, the chair of the Lords environment committee has told the government.

Baroness Sheehan challenged the refusal of the Environment Agency to clean up an illegal waste dump in Bolton House Road, Wigan, given the agency was spending millions clearing up illegal waste deposited in Kidlington, Oxfordshire.

Having visited the site in the village of Bickershaw, Wigan, Sheehan said a clean-up was urgent given “not only its environmental risks but also because of its public health imperatives”.

“While the committee understands that the Environment Agency is not funded to clear illegal waste sites, there are clearly circumstances in which it can do so under ministerial direction,” she said in a letter to the government.

The illegal dump in Wigan is next to a primary school. Last summer it caught fire for 10 days in a major incident which forced the school to close, and led to residents having to shut their windows as a result of the hazardous fumes.

Baroness Sheehan said there was a risk of further fires as the weather warmed up.

“Like Kidlington, Bickershaw constitutes a grave environmental hazard, as it is demonstrably not an inert facility,” she said. “As temperatures rise, rat infestations will inevitably proliferate, driving rodents towards nearby residences in search of sustenance; flies and maggots will once again breed prolifically.

“The pervasive stench already apparent during my January visit will intensify markedly.”

The Environment Agency has drawn up plans to remove the waste in Wigan, but only if funds become available, according to another peer, Susan Hayman, parliamentary under-secretary of state for environment, food and rural affairs.

In a letter she said the EA had taken the decision to clean up the waste dump in Kidlington because there was significant risk to the environment.

Similarly, an ongoing clean-up at Hoad’s Wood in Kent, which is being carried out by the EA, was also considered necessary because it was an exceptional case.

But the minister said: “The EA does not consider the Bolton House Road site to carry the same level of risk.”

The largest area of land on which the waste has been dumped in Wigan had no owner, the government said. It has now reverted to the ownership of the Duchy of Lancaster through the common law escheat principle.

“At present, the EA and partners have no powers to require the Duchy of Lancaster to clear that land,” she added.

Criminal investigations are ongoing into the illegal dumping in Kidlington and Wigan. Four men have been arrested in connection with the illegal dumping of waste at Kidlington. They have been released while the investigation continues.

The Duchy of Lancaster has been approached for comment.